According to industry groups representing such service providers, artificial intelligence is an important weapon when it comes to payment processors that fight the rise in floods of fraud.
The American Transaction Processors Coalition urged council members and staff to avoid regulating AI in any way that would hinder the use of evolving tools payment companies, said West Richards, executive director of the group. He said that it is because payment companies will become increasingly dependent on AI to combat criminals who use technology for fraud.
The issue surfaced this week as Congress members discussed the budget and spending settlement bill. That was the moratorium on Tuesday. I've been stripped of the bill 99-1 Senate vote before the entire bill passed by that room. There are no federal regulations specific to artificial intelligence.
Although ATPC, representing credit cards companies American Express, Payments Firm Deluxe and Processor Fiserv, did not have an official position on AI clauses that were excluded from the bill, acknowledging the weight of AI regulations is not something the coalition had in mind.
“The main driving force is that we need AI to fight AI, so don't handicap us with AI,” Richards said last month in an interview before the Senate vote. “Because these cyberattacks and these fraud attacks are increasingly AI-driven, we need the flexibility to use AI to combat these threats.”
Richards said companies have used previous forms of AI for many years, but would like to take advantage of a more advanced version. AI can sort payment transaction data much faster than humans, find signs of fraud more quickly, and identify suspicious patterns, he said.
“Fraud is a big issue raising alarms in DC,” Richards said.
Congressional members on both sides of the aisle are concerned about the increased threat of payment fraud. Senators sponsored the legislation Last month, I created a study task force Payment fraud They suggest ways lawmakers and regulators can fight them.
A few days after the Senators' announcement, the Federal Reserve Board, Federal Deposit Insurance Corporation and the Secretary of Currency said they had said Trying to deal with payment fraud properly. The agency proposed increased collaboration, increased industry education and improved supervision.
IPA CEO Brian Tate said in an interview this week that he was also concerned about fraud, another payments trade group, the Innovative Payments Association, but he is not taking a stand on how AI should use it as a tool to combat it.
Industry associations represent payment companies including Card Network Visa, Neobank Chime, Processor Fidelity National Information Services, and more. According to the IPA website.
“I don't think there's necessarily a need to change the rules as there are new tools to allow or help you make decisions,” Tate said Monday. “AI will play an ever bigger and bigger role in our lives. But we don't know if everyone necessarily knows where to land in terms of law and regulations.”
ATPC's Richards believes AI is already bringing about a change in the fight against fraud, and he argues that the industry should not be hampered by regulations that allow the industry to continue developing it.
In one example, Richards explained how AI uses card payment data to flag fraudulent transactions when AI buys sushi at lunchtime restaurant in San Francisco and cardholders are tracked when paying Italian meals on other coasts in New York after 30 minutes.
The technology pointed out the situation as a fraud, he said. Someone had created a fake credit card and used it in New York, he said. AI “triangulated these transactions a few minutes after the second (transaction) occurred,” West explained.
Some state organizations, Includes national meetings of state legislaturesopposes state moratoriums that regulate AI, and are satisfied with the Senate vote, giving states a free hand.
Processor Union remains “neutral” The 2010 moratorium said in an email before the Senate vote, but he suggested that there may be reservations for states that focus on the group. “The challenge will be that the subtle, bespoke AI laws in 50 state legislatures have the potential to hamper the industry's ability to tackle fraud and cybersecurity concerns each,” Richards said.
Last year, the coalition held an AI summit with speakers to convey a message to Congressional members and their staff. And it is not merely one-sided for the view of the Union. The group also wants to share what they know about evolving technologies.
“Our industry is pondering the beginning of AI regulation, so we hope to be a resource for these lawmakers,” Richards said.
